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Cash Adjustor Value to be Reduced for Relief Refinance Mortgages

May 9, 2012

To assist you in expanding your efforts to reach more borrowers through the Home Affordable Refinance Program (HARP), effective for commitments taken out on or after May 15, 2012, we are reducing the cash adjustor to zero basis points (bps) for Freddie Mac Relief Refinance MortgagesSM with higher loan-to-value (LTV) ratios sold through our fixed-rate Cash execution. This upcoming change continues our recent activity to further refine the Relief Refinance Mortgage to strongly encourage broad Seller adoption.

Sell & Deliver

Effective for commitments taken out on or after May 15, 2012, we will be enhancing our Cash execution by reducing the cash adjustor value to zero basis points for Relief Refinance Mortgages with LTV ratios greater than 125 percent and sold under fixed-rate Cash commitments. The Single-Family Seller/Servicer Guide (Guide) will be updated to reflect this change with a future Guide Bulletin.

This change is a reduction from the current 50 bps value, and is in addition to our recently implemented elimination of the cash adjustor for Relief Refinance Mortgages with LTV ratios greater than 105 and less than or equal to 125 percent.

This latest reduction to our Relief Refinance Mortgage cash adjustor is designed to lower your cost of using a Cash execution for higher LTV Relief Refinance Mortgages.

Current market conditions enable us to reduce the cash adjustor value at this time. The cash adjustor value still may change from time to time at Freddie Mac's discretion. You will be provided written notification in advance of any future changes to the cash adjustor value. In addition, the option to contact 800-FREDDIE to check the most current value still is available to you. The process to obtain the current cash adjustor is as follows:

  • Call 800-FREDDIE.
  • Select “1” for Freddie Mac Seller/Servicers.
  • Select “3” for selling system or loan delivery scenarios.
  • Select "2" for all other delivery or selling system assistance (enter 6-digit Seller/Servicer number).

We encourage you to pass on any savings to your borrowers to the maximum extent possible.

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